EPA methodology for small refinery exemption upheld

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Courtesy of Bergeson & Campbell, P.C.

On June 2, 2015, federal appellate judges decided that EPA's methodology for evaluating small refineries (those with crude oil throughput averaging 75,000 barrels or less per day) for exemptions from the RFS program was fair. Hermes Consol. LLC v. EPA, No. 14-1016 (D.C. Cir. June 2, 2015). Under the Clean Air Act (CAA), EPA is allowed to exempt small refiners from the annual blending requirements if compliance would cause ''disproportionate economic hardship.' There was a blanket exemption available for all small refineries in 2011 that expired in 2013. The case was brought by Hermes Consolidated, LLC, doing business as Wyoming Refining Company, a small refinery that applied for exemption from the 2013 renewable fuel blending requirements but was denied after EPA made mathematical errors while evaluating financial hardship. The court has ordered EPA to reconsider the petition from Hermes Consolidated, LLC, but has upheld EPA's overall methodology for conducting small refinery exception analyses.

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